On the go and no time to finish that story right now? Your News is the place for you to save content to read later from any device. Register with us and content you save will appear here so you can access them to read later.

"I'm guessing it's about 20 per cent of Katikati," deputy mayor Mike Williams said, when asked about the size of the farm. "It's blocking the town from expanding into a logical area."

According to Bay of Plenty Times enquiries, the land was bought more than 40 years ago by a South African who placed it in a family trust.

The farm now belongs to two sons living in Auckland who have not responded to a request for an interview.

They have rejected several lucrative offers from developers, preferring to lease it to sharemilkers who are enjoying a unique mix of urban and rural living.

"It's the best lifestyle," said property resident Jodie Troy. "We're farming in the middle of town. Who else can say that?"

Katikati has grown around the farm, and the sharemilkers estimate they have 60 neighbours.

Ms Troy said the farm had 140 cows, a 12-a-side milking shed and two houses, one of which was privately tenanted. Primary school children visited the farm, and cars stopped beside the road when cows were giving birth.

The Western Bay of Plenty District Council has zoned the land as residential, but the rates are thought to be manageable for the owners because most of the farm is in one block. This means that it is rated on a lower value than if it were divided into residential sections.

With the farm land unavailable, the council is looking to develop 100ha in the opposite direction, along Busby and Henry Rds to the west of town.

The cost of developing this land will be unknown until a $36,400 feasibility study is finished in late February, but Mr Williams and the council's resource management manager, Phillip Martelli, agreed that it would run to millions of dollars.

The study was meant to have taken place after 2021 but was brought forward to meet population growth.

Mr Martelli said the study would determine how much of the land could be developed, how many houses could be accommodated, the cost of infrastructure, and whether or not it was economically feasible to develop the area.